The 22-year-old was linked with a number of clubs throughout Europe, including West Ham, Fulham, Norwich, Tottenham and Reading.
French side Sochaux and Italian side Genoa have also been linked with the Azerbaijan-born winger.
Hamad will officially join Hoffenheim in January.
“Hamad is a young, ambitious and still developing player who has shown his qualities in Sweden,” said Hoffenheim sports director Alexander Rosen.
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The start of the 2017-18 Premier League season is just around the corner and is shaping up to be one of the most competitive yet.
As always it is the so called “big clubs” that have splashed the most cash in the transfer window so far this summer. Manchester United or City? Arsenal or Tottenham? Who are the winners and losers of the transfer window so far?